Have you reached the age of retirement, and are looking for ways to increase the proceeds of your retirement portfolio? When a homeowner, specifically, makes the transition into retirement, a reverse mortgage could be an effective strategy to increase the amount of capital in one’s retirement portfolio. If you are located in the areas of Hawaii, Florida, California, Washington, Illinois, or Ohio, Dan Turner with Geneva Financial can work closely with you to help determine if a reverse mortgage will help benefit your retirement planning.

What Is A Reverse Mortgage?

A reverse mortgage is a loan available for people 62 years of age or older and allows them to exchange a portion of their home equity into cash. The loan is called a “reverse” loan because instead of the borrower making monthly payments to a lender, the lender makes payments to the borrower. Although you don’t have to pay monthly mortgage payments on a reverse loan after you have paid the original mortgage off, you do still need to pay homeowner’s insurance and property taxes. This type of loan is particularly appealing to senior citizens who want to supplement their retirement income.

Retirement Portfolio Benefits From a Reverse Mortgage

There are several ways a reverse mortgage could help boost your retirement portfolio. First of all, it could allow you to postpone your social security benefits and help your other investments grow. If you draw money from your reverse mortgage, and delay accessing your other portfolio investments, such as a 401(k) retirement plan and your social security benefits, it would allow more time for the benefits to grow and increase the amount you can earn later on.

If you obtain a type of reverse mortgage known as an HECM, (Home Equity Conversion Mortgage), you can establish a growth line of credit, in which the line of credit can be accessed as a secondary line of cash in case of financial emergencies or be converted to monthly payments, while the credit line increases each period. Also, a reverse mortgage can protect the borrower from investment downturns by minimizing investment portfolio risks. In the event of a down market, your retirement portfolio and incoming cash amount may be diminished. The incoming funds from a reverse mortgage could help protect you financially until the market stabilizes.

Requirements For a Reverse Mortgage Loan

If obtaining a reverse mortgage sounds like an intriguing strategy for you to improve your retirement portfolio, it is important to note that there are some specific requirements involved when applying, including;

• You must be 62 years of age or older
• You must live in the home as your primary residence
• You must meet specific financial eligibility requirements and have adequate home equity
• You must complete loan counseling

 

Obtaining a Reverse Mortgage to Boost Your Retirement Portfolio

Although reverse mortgages are not always appropriate for every situation, they can offer a means to improving your retirement portfolio. If you are interested in learning more about this program and are located in certain regions of Hawaii, Florida, California, Washington, Illinois, or Ohio, contact Dan Turner with Geneva Financial today for a consultation. We can help determine if a reverse mortgage is the right retirement solution for you.